How to Increase Claim Filing Rates in Class Action Litigation
As a claims administration professional, one of the first questions my clients ask me is, “how can we get more claims?” Maximizing the claim filing rate helps to ensure that the class benefit reaches as many class members as possible, which now more than ever is an important factor in obtaining final approval. Once the parties have agreed on the settlement, generally there is an agreement to maximize the claim filing rate. Since it benefits both parties, it makes sense to implement some common sense practices.
Here are some tips to consider which will improve claim form response rates:
Explain the Class Action Claim Filing Pitch
It may seem like this would be self-explanatory; file a claim and we will pay you. However, claim forms are competing with countless marketing materials for class member attention. When drafting a claim form and the accompanying notice, use a great headline, clearly explain the options, and give short summaries and overviews in addition to thorough explanations of rights and options.
Incentivize Class Action Claim Response
Once you have clearly stated what you are asking of the class member, make responding worth their while. The prospect of $50 in 9 months is more enticing than the possibility of an unknown dollar amount at some undetermined time in the future. When a class member sees the unknown, they assume they may get $1 in several years. Communicating a dollar range and expected timing helps incentivize potential claimants to file.
We understand that for pro rata settlements, estimated payouts generally depend on response rates and the timing of check mailing is dependent upon many things that are often uncertain at the time of claim form mailing. However, in my experience, underestimating the recovery amount and overestimating the payment date is better than no estimate at all. For the recovery amount, assume all funds taken out of the settlement fund will be at their highest (attorney fees and costs, administrative costs if they are paid out of the fund, etc.) and then assume the highest reasonable claim filing rate to determine a payment range. Make sure to round-down and provide the appropriate caveats. For the payment date, most settlement agreements give sufficient timing that we can estimate approximately when checks will mail (again, with the appropriate caveats, such as “assuming no appeals”).
Ease Class Action Response Requirements
The fewer barriers to filing a claim, the higher the claim rate will be. Only ask for information that is absolutely necessary to process and pay the claim. Each additional requirement will directly affect the response rate. For example, in a Telephone Consumer Protection Act (TCPA) case that is paid out on a per phone number basis, asking for the number of times they received a call is not necessary to calculate the payment and may deter people that cannot recall the number of phone calls from filing a claim.
Similarly, only ask for supporting documentation if it is required for verification purposes. Supporting documentation is necessary and important in some cases, but not all. In my experience, asking for supporting documentation significantly decreases response rates. A more efficient method may be to include an audit provision in which a certain segment of the claims (such as high value claims) may be audited and supporting documentation may be requested. Furthermore, not requiring supporting documentation will increase the efficiency of processing; leading to more money in the settlement fund available to class members (assuming processing costs are paid out of the fund).
Online Class Action Claim Tips
Cases that accept both online and paper claims have much higher filing rates than those that accept only paper claims. For online claim filing, I recommend including a claim code on the mailed notice to ease digital filing. Once a claimant enters the claim code, the website will pre-populate the claim form with their information, which they can edit and submit.
Paper Class Action Claim Tips
For paper claims, the most effective way to increase response is to pre-pay the return postage. Some postcard claims may only require a signature before dropping in the nearest mailbox. For longer claim forms, providing a postage pre-paid envelope encourages a higher response rate.
For further tips on improving claim filing rates, contact your Epiq client services team or call +1 503 350 5800.
Charles Marr is a senior project manager for Epiq class action, mass tort, and claims administration business. As a senior project manager, Marr is responsible for overseeing all aspects of case administration, including counsel and court coordination, settlement or judgment implementation, noticing, claims processing, disbursement, budgeting, personnel management, and quality assurance. Prior to joining Epiq, Marr practiced law for five years in the areas of business transactions and insurance defense.